Australia is one of the company's bigger overseas markets, with 39 stores out of an empire of more than 1000 operated and licensed stores outside America.

A company statement said only the American and Canadian businesses were impacted by the move in Chapter 11 bankruptcy.

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A Toys R Us store in Louisville, Kentucky. The retailer's US parent company is filing for bankruptcy.Credit:Luke Sharrett

"The company's operations outside of the US and Canada, including its operations in Europe and Australia and its approximately 255 licensed stores and joint venture partnership in Asia, which are separate entities, are not part of the Chapter 11 filing," a company statement said.

In June, the company reported a net loss of $US164 million in the quarter ended April 29, compared to a $US 126 million loss for the same period in the prior year.

It hasn't shown an annual profit since 2013. According to annual accounts released in February the Australian business posted net sales of $US207 million in the year to the end of January, up from $US196 million the year before but down on the $US230 million from a year earlier.

"Our stores are open and will continue to provide Toys"R"Us Australian customers with our signature fantastic service," a local spokeswoman said.

The spokeswoman could not say whether the parent company's struggles would impact on the range in its Australian stores.

She said the company would push on with its plans to open four more stores by Christmas.

In a statement the company said the Chapter 11 process would allow it to restructure its outstanding debt.

"We are confident that we are taking the right steps to ensure that the iconic Toys"R"Us and Babies"R"Us brands live on for many generations," said Toys"R"Us chairman and chief executive Dave Brandon.

"Our customers around the world can continue to count on an outstanding shopping experience and excellent service whenever, wherever and however they choose to shop with us. As the holiday season approaches, our global team members are ready to serve the millions of kids and families who will be shopping with us."

The company said it was also working with its "vendors around the world to help ensure that inventory levels are maintained and products continue to be delivered in a timely fashion".

The chain secured $US3 billion in debtor-in-possession financing to stay open while it restructures, according to a company statement.

The bankruptcy filing is the latest blow to a brick-and-mortar retail industry reeling from store closures, sluggish mall traffic and the threat of Amazon.com.

Much of the toy merchant's debt is the legacy of a $US7.5 billion leveraged buyout in 2005 in which Bain Capital, KKR & Co. and Vornado Realty Trust loaded the company with debt to take it private. Since then, the Wayne, New Jersey-based chain has struggled to dig itself out.

Mr Brandon took over Toys "R" Us in 2015 and sought to make shopping there a more enjoyable experience. Last year, he set out a vision of kids "dragging their parents to our stores because they want to see what's going on."

While Mr Brandon made some progress reducing liabilities, he ultimately was unable to resuscitate the chain's fortunes.

The company sells toy and baby merchandise in more than 1,500 Toys "R" Us and Babies "R" Us locations worldwide and through websites including Toysrus.com and Babiesrus.com.

Charles Lazarus opened Children's Bargain Town, a baby-furniture store, in Washington in 1948, according to the Toys "R" Us website. He added toys two years later and opened the first Toys "R" Us, modelled after self-service supermarkets, in 1957. Lazarus stepped down as chairman and CEO in 1994. Two years later, the first babies "R" Us opened.